Bitcoin mining banned! Know reason why

Yet another government has imposed a Bitcoin mining ban. Now, some miners are selling their equipment or trying to move abroad.

| Updated on: Aug 21 2022, 23:33 IST
FILE PHOTO: Bitcoin mining computers are pictured in Bitfury's mining farm near Keflavik, Iceland. (REUTERS)
FILE PHOTO: Bitcoin mining computers are pictured in Bitfury's mining farm near Keflavik, Iceland. (REUTERS)

Soaring energy prices and power blackouts in Kosovo, one of the poorest countries in Europe, led to a government Bitcoin mining ban. Now, some miners are selling their equipment or trying to move abroad, industry participants say. The landlocked Balkan state is only the latest to crackdown on crypto mining after being buffeted by high energy prices. Kazakhstan, which had become a popular base for miners who fled China, took similar measures late last year. 

Kosovo confiscated 429 devices used to mine cryptocurrencies during first few days of January, the newspaper Gazetta Express reported. The move follows energy blackouts because of high import prices and an unexpected shut-down of a power plant a month earlier.

Generating the world's biggest cryptocurrency requires special computers that work to solve complex mathematical problems, and the biggest operating expense for miners is electricity.

Ardian Alaj, the co-owner of a crypto exchange in Kosovo's capital Pristina, told Bloomberg he'd heard of multiple examples of miners selling or trying to sell equipment in the aftermath of the ban. There are “minimal cases” of miners going to neighboring countries, he said by email. 

“Mining was done in Kosovo, because it was possible to do it illegally,” said Alaj. It was also cheap: the northern region of Mitrovica, a popular hub for crypto mining, is one of the four Serb-majority parts of the country that exempts citizens from electric bills. 

“Moving operations abroad would create additional costs the local miners are not accustomed to,” Alaj said. 

Kosovo declared independence from Serbia in 2008, almost a decade after a war over the territory ended with NATO air raids against Serbian forces.

Serbian activists block roads in protest against lithium project

(Reuters) Hundreds of environmental activists on Saturday blocked several main roads in Serbia including a border crossing to Bosnia in the latest protests against Rio Tinto's plans to develop a $2.4 billion lithium mine.

The protests have become a headache for Serbia's ruling coalition ahead of an April 3 general election, and Prime Minister Ana Brnabic told Reuters this week a decision on whether to let the project proceed would be made after the vote.

The government has offered mineral resources to foreign investors including China's Zijin copper miner and Rio Tinto as it seeks to boost economic growth, but green activists say the mining projects will cause pollution.

"We do not want to be quiet ... We want this country to be (safe) for our children," said Ivana, asking not to give her full name, who was among a group of protesters blocking a highway in a neighbourhood of the capital, Belgrade.

Many of the protesters carried banners. "Stop investors, save nature", one of the placards read.

A crossing point to neighbouring Bosnia was also blocked along with roads near the towns of Cacak and Sabac.

The anti-mining protests have been held every Saturday since late November, with a break for the New Year and Orthodox Christmas holidays.

Soon after the demonstrations began, conservative President Aleksandar Vucic asked parliament to rework an expropriation law allowing the state to swiftly acquire property for potential development. Environmentalists had opposed the legislation. Serbia is one of Europe's most polluted countries and will need billions of euros to meet the European Union's environmental standards if it wants to join the bloc.

Rio Tinto has said it would adhere to all domestic and EU environmental standards at its lithium mine in Serbia.

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First Published Date: 18 Jan, 10:02 IST